Global Streaming Revenues Will Increase by 14% in 2023
by Frankie Karrer
3 Min Read
CTV evolves once again as platforms lock in sports, news—and movie theaters
4 Min Read
We’ve talked a lot about how big Connected TV has become. CTV has hit record viewership numbers and is on track to outpace cable TV by next year. More streaming services are launching ad-supported offerings (and they’re a hit). And last summer CTV finally bested linear TV in views for the first time.
Now not only are streaming services gobbling up the last bastions of linear TV—live sports and national news—they’re taking over the local cineplexes. If you thought CTV has grown big over the last few years, this week’s news is proof that the biggest leaps are still to come.
Here’s something no one had on their 2023 bingo card: streaming services are heading to the movie theaters. After years of lockdowns and world premiers streaming in our living rooms, movie theaters have opened up to a new landscape—and are producing some big box office returns. Now Apple, fresh from its Best Picture Oscar last year for CODA, is planning to spend $1 billion a year to produce movies that will release first in theaters. Further, the tech giant has reportedly approached movie studios on partnering for certain titles to garner as big of a release as possible.
The plan, according to Bloomberg, is for Apple to air movies in thousands of theaters for at least one month before releasing them on AppleTV+. This directly contradicts previous strategies that focused on streaming debuts with limited theatrical runs—but Apple isn’t alone. Rival Amazon has committed to similar plans (also with a $1 billion budget) to produce 12-15 movies a year exclusively for theaters—likely involving their recent acquisition of movie studio giant MGM for $8.5 billion. While Apple and Amazon are the first to test this new experiment, they surely won’t be the last.
These moves come at a time when the streaming landscape is maturing and media giants are moving from the “spending” growth phase to a profitability one. For media companies, theatrical releases are a way to offset the rising costs of maintaining their streaming services while giving them revenue to reinvest in the platform. Viewers meanwhile get more choices to see hit films and enjoy an increase in streaming’s content slate quality. And advertisers benefit from a movie generating buzz before eager audiences catch it at home on ad-supported streaming.
Apple isn’t just looking at becoming a major player in Hollywood—it wants to be the home of streaming sports as well. The company already spent $2.5 billion on a 10-year deal with both Major League Soccer and Friday night Major League Baseball games. Now Apple is reportedly interested in securing the streaming rights to English football games as well. These moves follow a trend of streaming services slowly encroaching on live sports, and they’re already becoming lucrative for license holders. While AppleTV+ users were previously able to watch MLB games for free, the service announced this week that viewers now need to pay an additional $6.99 a month subscription to stream games.
Sports isn’t the only linear TV holdout slowly following movies and shows to streaming; the morning news is joining CTV as well. This week Peacock announced that they’re adding live news from NBC-owned news stations in a daily block called “Morning News Live.” For no additional charge, Peacock Premium Plus subscribers will be able to stream hit programming including MSNBC’s “Morning Joe” and CNBC’s “Squawk Box” in addition to existing news programming including NBC News NOW and “Today.” While 24/7 live feeds of MSNBC and CNBC have yet to arrive to Peacock, this groundbreaking move to incorporate live news coverage is finally building a path toward CTV news programming that mirrors its linear TV counterpart.
These moves all reflect another major period of growth for CTV as the platform continues to influence things both on our living room TVs — and beyond it. And that’s spelling big opportunities for advertisers, many of which are already seeing big ad gains as events like NCAA March Madness are streamed by more viewers. Already Netflix’s recent foray into ads is paying off for both the service and advertisers, as the service announced that their ad-supported tier reached one million active subscribers in January.
Now more services are migrating their must-see linear content to streaming, more viewers are embracing CTV ads, and the media companies behind these services are finding new ways to generate profits that can be funneled back into bolstering their streaming content. It’s a self-perpetuating cycle, and one that’s going to continue picking up momentum. Where CTV goes from here is anyone’s guess, but we’re likely going to see a lot more “growth spurts” soon—and see them more often.
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